Cuban President Raul Castro. (Photo: UN)        Font Size ..... Small Normal Big Very Big

BY LORO HORTA

Since Raul Castro succeeded his legendary brother Fidel at the helm of the Cuban “revolution” he has embarked on a rapid reform of the island communist economy.

In the three months since he officially succeeded his brother Fidel Castro, Raul has launched a series of reforms that may lead one of the oldest communist nations on the road to capitalism and a market economy. Starting from minor moves such as lifting bans on Cubans buying DVDs, microwaves, cameras and other electronic appliances to reforms of the agricultural sector, Raul seems determent to reform the country’s decrepit economy. 

CHINESE MODEL OR NOT?

While observers of Cuban politics have long speculated that Cuba may follow the Chinese communist’s path to capitalism, until 2005, Fidel, while praising China’s progress, has dismissed any idea of adopting capitalism. As recently has May 2007, a Cuban official interviewed by the author in Beijing argued that “Cuba and China have different realities and therefore, reforms on the Chinese model were not suited." 

However, despite all these denials and dismissals, the Cuban government - and especially Raul - has looked to China for inspiration and practical assistance. It’s no coincidence that the first sector to be reformed in Cuba was the agricultural sector - just like in the PRC where the CCP's first reformist move was to allow farmers to sell their products directly to the market in 1979.  The decision to open up the agricultural sector was strongly influenced by the Chinese who sent at least three delegations of specialists to Cuba between 2003-2005 to advise the Cuban’s on their own agricultural reform. This was followed by visits of two Cuban delegations to Chinese so called “model villages” where farmers had formed their own commercial enterprises that grew into major successful agri business.  

SPECIAL ZONES

The Chinese have also been encouraging the Cubans to create special economic zones and accelerate privatization of state owned enterprises - a move expected to benefit Chinese state- owned companies that have built quite a strong presence in Cuba in recent years. In 2007, China became Cuba’s second-largest trading partner - a position likely to improve in the wake of the new Chinese-inspired reforms. Chinese input is particularly significant in the areas of economic and industrial reform - with Professor Lu Yong Hur (one of Deng Xiao Ping’s top former economic advisers and one of the brains behind the concept of special economic zones in Southern China in the 1980s) assuming a major guiding role. Since his retirement from government, Professor Hur has advised various governments around the world on economic reform and the establishment of special economic zones and industrial parks. A specialist on the Portuguese-speaking countries, he was pivotal in promoting China’s burgeoning relation with Brazil and Latin America while being also being a driving force behind Beijing’s meteoric presence in Portuguese Africa and Timor.   

In April 2005, Raul visited China for 9 days, visiting various industrial parks and the first Chinese special economic zones in Southern China and major cities such as Shanghai. Many of the Professor Hur’s disciples from the ministry of finance and the ministry of commerce have been sent to Cuba as advisors, while large numbers of Cuban bureaucrats have been sent to the PRC for temporary attachment and on-site training to various ministry and state-owned enterprises and banks such as Exibank, Sinopec, Petrochina, NORINCO, Zhen Hua Harbor and Construction and Agricultural Machinery Import Export among others. Personnel from the ministries of railways, industry and information, land resources, and finance have also been sent to Cuba on a regular basis.  The main objective of this arrangement is to prepare Cuban bureaucrats to run Cuba’s ailing state enterprises in a more effective manner while also giving them the skills to limit the fall-out of privatization and its resulting workers layout.   

REBRANDING

China is also helping the Cuban communist party re-brand itself - advising it to put more emphasis on issues such as nationalism and economic growth instead of ideological rhetoric and anti-American tirades that harm business. Following the total discredit of Marxism in China, the CCP has relied on economic growth and nationalism as the main sources of its legitimacy. Raul’s pragmatism may well lead to a metamorphosis of the Cuban communist party and state, transforming it into an authoritarian, capitalist-corporate bureaucracy in everything but name. Raul’s military background and his 32-year tenure as Minister of the Revolutionary Armed Forces, is likely to ensure the  support of the military for the reforms and make it  its ultimate guarantor in the same way that the PLA has emerged as the CCP’s last line of defense after the Tiananmen crackdown. However, as long as Fidel Castro is around, the reforms will proceed at much slower pace than perhaps desired by his more pragmatic brother. Indeed, Fidel’s guarded support for the reforms was seen when in April he warned against selfishness and greediness.       

As I devoured a delicious Beijing duck in a discreet Beijing restaurant, Colonel Hua - my thesis supervisor at the PLA National Defense University - said: "Oh, my friend, it seems you really like Beijing duck." To which Professor Hur added: “But not as much as my friend Raul. When he was here, he ate it all the time - some times even for breakfast."

While indeed my taste for the famous duck is not in question, so it seems neither is Raul Castro's taste for the Chinese model.    

Loro Horta is a research associate fellow at the S Rajartnam School of International Studies, Nanyang Technology University Singapore and a graduate of the National Defense University of the Peoples Liberation Army (PLANDU). He regularly visits China and has written for Asia’s major newspapers, such as the Australian Financial Review, The Straits Times ,The Asia Times, The Jakarta Post among others.

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